Do you want to increase sales for your brand but aren't sure what to try next? Is rising customer acquisition costs hurting your already strained marketing budget, making a major ad spend push impossible? The answer is actually simpler than you might think: Sell on more channels!
According to a survey conducted by Glossy and Modern Retail, direct-to-consumer (DTC) brands are increasingly investing in wholesale. 62% of respondents said wholesale revenue increased the most, even compared to direct sales. With sales going up at Nordstrom, for example, it’s no wonder that a digitally-native brand like Everlane would stock products there.
When it comes to wholesale, there are a number of different sales channels you can use in order to get your products in front of more customers. Of course, the “if you can’t beat ’em, join ’em” mentality puts the idea of Amazon in many brand’s heads…
To represent your brand where your website cannot, we recommend choosing a physical store over a marketplace for your additional sales channel.
A marketplace like Amazon is great for reach (the online giant averaged 5.3 billion visits per month as of July 2022), but it’s not so great for quality control. Your small-but-growing DTC brand will be competing with hundreds of lower-quality products that are sold at a cheaper price.
And a Reuters investigative report found that Amazon copied products and manipulated the search results to promote its own brands.
To maintain your brand experience, sell your products with major brick-and-mortar players like Nordstrom and REI, or even local boutiques and “mom and pop shops” with only a few locations. This will help control your scaling efforts, as you can choose to be in one store before you are ready for several.
Okay, we’ve answered the ‘where’, but what about the ‘how’? It’s one thing to choose where you trust your brand to be represented offline, it’s another to set it in motion.
Once you make the decision to sell across more than one channel, the processes need to be put in place to ensure that you won’t run out of product for each of your channels. This sounds obvious, but allocating and reserving inventory for wholesale partners will be a tedious task if you’re relying on spreadsheets or a finance tool to track inventory. This manual process is not only time-consuming, but error-prone as it is reliant on data that isn’t up-to-date.
You need one centralized hub that acts as your single source of truth for all things inventory. Even if your brand utilizes one warehouse, you still have three locations of inventory: What’s coming in from the manufacturer, what’s sitting at the warehouse, and what’s coming back in from returns. Then you have all the different inventory statuses to keep track of, like what’s reserved for wholesale, what’s already committed to an existing order number, and what’s damaged and needs to be returned to the manufacturer, to name a few.
All this information needs to be in one place—and it needs to be updated in real-time as orders come in through your various sales channels—for your wholesale initiative to be successful. After all, you wouldn’t want to put the efforts in place to secure a partnership with Nordstrom, only to get the relationship started on the wrong foot by not properly fulfilling your wholesale order. When inventory data is up-to-date across your sales channels (e.g., Shopify, wholesale partners, your brand’s physical stores, etc.), your warehouse(s), and your ERPs and other in-house systems, you can confidently allocate your inventory.